Alberto Fujimori served as the 54th President of Peru from 28 July 1990 to 22 November 2000. A controversial figure, Fujimori has been credited with the creation of Fujimorism, defeating the Shining Path insurgency in Peru and restoring its macroeconomic stability.Fox, Elizabeth, and Fox, de Cardona and Waisbord, Silvio Ricardo. Latin Politics, Global Media. 2002, p. 154Hough, Peter. Understanding Global Security. 2008, pp. 79–80 However, he was criticized for his authoritarian way of ruling the country (especially after 1992) and was accused of human rights violations. Even amid his prosecution in 2008 for crimes against humanity relating to his presidency, two-thirds of Peruvians polled voiced approval for his leadership in that period.
Fujimori's economic policy was largely adopted from the advice of Peruvian economist Hernando de Soto, who prescribed economic guidelines – including the loosening of economic regulation, the introduction of austerity measures and the utilization of neoliberal policies – that were ultimately adopted by the Fujimori administration and established in the 1993 Constitution of Peru. Eventually, the policies resulted in Peru becoming macro-economically stable and gave way to the strongest surge in economic growth in Peru following the period of price controls and increased regulation established during the Lost Decade.
Background A dark horse candidate, Fujimori won the 1990 presidential election under the banner of the new party Cambio 90 ("cambio" meaning "change"), beating world-renowned writer Mario Vargas Llosa in a surprising upset. He capitalized on profound disenchantment with previous president Alan García and his American Popular Revolutionary Alliance party (APRA). He exploited popular distrust of Vargas Llosa's identification with the existing Peruvian political establishment, and uncertainty about Vargas Llosa's plans for neoliberal economic reforms. Fujimori won much support from the poor, who had been frightened by Vargas Llosa's austerity proposals.
During the campaign, Fujimori was nicknamed El Chino, which roughly translates to "Chinaman"; it is common for people of any East Asian descent to be called chino in Peru, as elsewhere in Latin America, both derogatively and affectionately. Although he is of Japanese heritage, Fujimori has suggested that he was always gladdened by the term, which he perceived as a term of affection.Interview with Fujimori, in Ellen Perry's The Fall of Fujimori With his election victory, he became the first person of East Asian descent to become head of government of a Latin American nation, and just the third of East Asian descent to govern a South American state, after Arthur Chung of Guyana and Henk Chin A Sen of Suriname (each of whom had served as head of state, rather than head of government).
First term: 28 July 1990 – 28 July 1995
Fujishock During his first term in office, Fujimori enacted wide-ranging neoliberal reforms, known as Fujishock. During the presidency of Alan García, the economy had entered a period of hyperinflation and the political system was in crisis due to the country's internal conflict, leaving Peru in "economic and political chaos".Benson, Sara and Hellander, Paul and Wlodarski, Rafael. Lonely Planet: Peru. 2007, pages 37–8. Nonetheless, the Fujishock succeeded in restoring Peru to the global economy, though not without immediate social cost.Manzetti, Luigi. Privatization South American Style. 1999, page 235.
The immediate target of the first Fujimori Administration, was to stop the runaway course of inflation. Beyond that, the goals included repudiating protection and import substitution, returning to full participation in the world trading and financial systems, eliminating domestic price controls and subsidies, raising public revenue and holding government spending strictly to the levels of current revenue, initiating a social emergency program to reduce the shock of adjustment for the poor, and devoting a higher share of the country's resources to rural investment and correction of the causes of rural poverty. In practice, new measures came out in bits and pieces, dominated by immediate concern to stop inflation; actions taken in the first year did not complete the program.John Sheahan, Searching for a better society, p. 157. Reforms have permitted an economic growth since 1993, except for a slump after the 1997 Asian financial crisis. Banco Central de Reserva, Producto bruto interno por sectores productivos 1951–2006 . Retrieved on May 15, 2007.
Fujimori's initiative relaxed private sector price controls, drastically reduced government subsidies and government employment, eliminated all exchange controls, and also reduced restrictions on investment, imports, and capital flow. Tariffs were radically simplified, the minimum wage was immediately quadrupled, and the government established a $400 million poverty relief fund. The latter measure seemed to anticipate the economic agony that was to come, as electricity costs quintupled, water prices rose eightfold, and gasoline prices rose 3000%.
The IMF was impressed by these measures, and guaranteed loan funding for Peru.Gouge, Thomas. Exodus from Capitalism: The End of Inflation and Debt. 2003, page 364. Inflation began to fall rapidly and foreign investment capital flooded in. Fujimori's privatization campaign featured the selling off of hundreds of state-owned enterprises, and the replacing of the country's troubled currency, the inti, with the Nuevo Sol. The Fujishock restored macroeconomic stability to the economy and triggered a considerable long-term economic upturn in the mid-1990s.Stokes, Susan Carol. Public Support for Market Reforms in New Democracies. 2001, page 163. In 1994, the Peruvian economy grew at a rate of 13%, faster than any other economy in the world.
A prime target for the privatization were a series of state-owned companies in the mineral industry. First in 1991 and 1992 the Peruvuan state sold off its shares in medium-scale mining. In the years that followed assetst belonging to the large-scale mining category were sold; in November 1992 Minpeco was sold and in 1993 and 1994 Cerro Verde and Tintaya as well as the processing plants Refinería de Zinc de Cajamarquilla and Refinería de Cobre de Ilo were sold. The sale plans for the large polymetallic mining company Centromin Peru failed as no investor showed interest.
1992 Peruvian coup d'état
During Fujimori's first term in office, APRA and Vargas Llosa's party, FREDEMO, remained in control of both chambers of Congress (the Chamber of Deputies and Senate), hampering the government's ability to enact economic reforms. Fujimori also found it difficult to combat the threat posed by the Maoist guerrilla organization Shining Path (), due largely to what he perceived to be the intransigence and obstructionism of Congress. By March 1992, Congress met with the approval of only 17% of the electorate, according to one poll (the presidency stood at 42%, in the same poll).Smith, Peter H. Latin America in Comparative Perspective: New Approaches to Methods and Analysis. 1995, page 234.
In response to the political deadlock, on 5 April 1992, Fujimori with the support of the military carried out a presidential coup, also known as the autogolpe (auto-coup or self-coup) or Fujigolpe (Fuji-coup) in Peru. He shut down Congress, suspended the constitution, and purged the judiciary. The coup was welcomed by the public, according to numerous polls.Smith, Peter H. Latin America in Comparative Perspective: New Approaches to Methods and Analysis. 1995, page 236. Not only was the coup itself marked by favorable public opinion in several independent polls, but also public approval of the Fujimori administration jumped significantly in the wake of the coup.Barry S. Levitt. 2006 "A desultory defense of democracy: OAS Resolution 1080 and the Inter-American Democratic Charter. (Organization of American States)." Latin American Politics and Society 48(3):93–123. Fujimori often cited this public support in defending the coup, which he characterized as "not a negation of real democracy, but on the contrary… a search for an authentic transformation to assure a legitimate and effective democracy." Fujimori believed that Peruvian democracy had been nothing more than "a deceptive formality – a facade"; he claimed the coup was necessary to break with the deeply entrenched special interests that were hindering him from rescuing Peru from the chaotic state in which García had left it. Mensaje a la nación del presidente del Perú, ingeniero Alberto Fujimori Fujimori, el 5 de abril de 1992 (PDF). On the website of the Peruvian National Congress. Retrieved 26 September 2006. Fujimori's coup was immediately met with the near-unanimous condemnation by the international community. The Organization of American States denounced the coup and demanded a return to "representative democracy",Smith, Peter H. Latin America in Comparative Perspective: New Approaches to Methods and Analysis. 1995, page 238. despite Fujimori's claims that his coup represented a "popular uprising". Various foreign ministers of OAS member states reiterated this condemnation of the autogolpe. They proposed an urgent effort to promote the re-establishment of "the democratic institutional order" in Peru.Organization of American States (OAS). 1992. Ser. G MRE/RES 1/92 April 13. Following negotiations involving the OAS, the government, and opposition groups, Alberto Fujimori's initial response was to hold a referendum to ratify the auto-coup, which the OAS rejected. Fujimori then proposed scheduling elections for a Democratic Constituent Congress (CCD), which would be charged with drafting a new constitution, to be ratified by a national referendum. Despite the lack of consensus among political forces in Peru regarding this proposal, the ad hoc OAS meeting of ministers nevertheless approved Fujimori's offer in mid-May, and elections for the CCD were held on 22 November 1992.
Various states acted to condemn the coup individually. Venezuela broke off diplomatic relations, and Argentina withdrew its ambassador. Chile joined Argentina in requesting that Peru be suspended from the Organization of American States. International financiers delayed planned or projected loans, and the United States, Germany and Spain suspended all non-humanitarian aid to Peru. The coup appeared to threaten the economic recovery strategy of reinsertion, and complicated the process of clearing arrears with the International Monetary Fund.
Whereas Peruvian–U.S. relations early in Fujimori's presidency had been dominated by questions of coca eradication, Fujimori's autogolpe immediately became a major obstacle to international relations, as the United States immediately suspended all military and economic aid to Peru, with exceptions for counter-narcotic and humanitarian-related funds.Cameron, Maxwell A. and Mauceri, Philip. The Peruvian Labyrinth. 1997, page 216.
Post-coup period With FREDEMO dissolved and APRA's leader, Alan García, exiled to Colombia, Fujimori sought to legitimize his position. He called elections for a Democratic Constitutional Congress that would serve as a legislature and a constituent assembly. While APRA and Popular Action attempted to boycott this, the Popular Christian Party (PPC, not to be confused with PCP Partido Comunista del Peru) and many left-leaning parties participated in this election. His supporters won a majority in this body, and drafted a new constitution in 1993. A referendum was scheduled, and the coup and the Constitution of 1993 were approved by a narrow margin of between four and five percent.